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SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc.

Caza Oil & Gas, Inc. · Dec 5, 2012 · 46 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 1
    SE New Mexico Horizontal Bone Spring Economic Prospective December 5, 2012 Tony B. Sam Randy Nickerson 1
  2. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 2
    Outline About Caza Bone Spring Introduction Bone Spring Production Statistics Bone Spring Economics Frac Parameters Rock Properties Rock Pore Volume and Stimulation Comparisons Conclusions 3
  3. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 3
    About Caza 4
  4. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 4
    Company Overview Caza Oil & Gas is an independent oil and gas company focused on onshore exploration, development and production in New Mexico, Louisiana & Texas. Headquartered in Houston, Texas and dual listed on AIM and TSX.…
  5. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 5
    Caza at a Glance NEW MEXICO Bone Spring Horizontal Play LOUISIANA Midland TEXAS Houston Wolfberry Play Area New Orleans Regional knowledge Texas Gulf Louisiana 3D Coast 3D Seismic Play Seismic Play Hold…
  6. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 6
    Bone Spring New Mexico 7
  7. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 7
    Bone Spring Play - SE New Mexico Zones of Interest Play Area Bone Spring Play is one of the most active emerging oil plays in the U.S. 613 Horizontal wells completed since 19981 Increased activity since 2009, driven by…
  8. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 8
    Caza Bone Spring Summary Caza Property Locations Approximately 5,680 gross (3,312 net) acres Currently 4 wells producing1: Bradley Caza Ridge 14 State 3H 1,060 Bo/d, & 1,212 Mcf/d Lynch Copperline Property Two Mesas Mewbourne…
  9. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 9
    Caza Ridge 14 State 3H Copperline Property Rate: 1,262 Boe/d Oil: 1,060 Bo/d Gas: 1,212 Mcf/d 22/64 Choke 1,800 psi CP 11/7/12 PDP Reserves (NET): 323,304 Bo 820,062 Mcf 10 Caza Internal Estimate of Net PDP Reserves
  10. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 10
    Bone Spring Play Facts One of the most active oil plays in the US: Pay zones include Delaware, Avalon Shale, 1st, 2nd, 3rd Bone Spring Sands, and Wolfcamp Up to 24 potential horizontal locations per square mile 613 Horizontal wells…
  11. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 11
    Credit Suisse Fundamentals & US Oil Production Outlook Sept. 2012 13 1. Credit Suisse Fundamentals & US Oil Production Outlook Sept. 2012
  12. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 12
    Credit Suisse Fundamentals & US Oil Production Outlook Sept. 2012 14 1. Credit Suisse Fundamentals & US Oil Production Outlook Sept. 2012
  13. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 13
    Bone Spring (Wells put on production after 2011 309 wells) 15 Estimated EUR from PI Dwights and Drilling Info through September, 2012 Public production data from State of Mexico, and Drilling Info through September, 2012
  14. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 14
    Bone Spring 180 Day Production (All Wells) 16 Estimated EUR from PI Dwights and Drilling Info through September, 2012 Public production data from State of Mexico, and Drilling Info through September, 2012
  15. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 15
    Bone Spring Play 180 Day Cumulative Production (Boe) COG Operating Aircobra 12 State 3rd BS Sand Type Well Caza Petroleum Mudslide Slim 15-1 1st BS Sand Type Well COG Operating Stratojet 31 State 3H 2nd BS Sand Type…
  16. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 16
    Bone Spring Production EUR Per Zone Started Production after January 2011 Pmean Case Pmean Case 324 Mboe 342Mboe 124 Mbo 204Mbo 1.25 Bcfg 0.99 Bcfg Pmean Case Pmean Case 328 Mboe 451 Mboe 239 Mbo 348 Mbo 0.55 Bcfg 0.66…
  17. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 17
    Water Production vs. Oil & Gas Production Mean- 87,457 Bw/well - 306,100 3.50/bbl 19 Public production data from State of Mexico, and Drilling Info through September, 2012
  18. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 18
    Bone Spring Economics 20
  19. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 19
    Bone Spring Play Economics* EUR EUR DISC. RETURN LIFE Formation MBOE MBO EUR BCFG NPV 10% (M) ROR ON INVEST. PAYOUT YEARS AVALON SHALE 346.7 126.5 1.32 2,640 26.17% 1.42 3.1 24.9 1ST BONE SPRING SD 378.8 203.8 1.05 5,080 46.80% 1.85…
  20. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 20
    Economics - PV10 Sensitivity to Oil Price 14,000 12,000 10,000 PV10 Avalon Eddy 6MM-CWC 8,000 PV 10 (,1000) PV 10 Avalon Lea 7MM-CWC PV10 1st BS Eddy 6.25MM-CWC PV10 1st BS Lea 7.25MM-CWC 6,000 PV10 2nd Eddy…
  21. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 21
    Economics Rate of Return Sensitivity to Oil Price 100.0% 90.0% 80.0% Rate of Return(%) 70.0% Zone & County ROR Avalon Eddy 6MM CWC 60.0% ROR Avalon Lea 7MM CWC ROR 1st BS Eddy 6.25MM CWC 50.0% ROR 1st BS Lea 7.25MM…
  22. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 22
    Economics 2nd Bone Spring Sand Rate of Return Sensitivity to Oil Price & CWC 120.0% 100.0% Rate of Return(%) 80.0% ROR 2nd BS 75/Bo 60.0% ROR 2nd BS 85/Bo ROR 2nd BS 95/Bo ROR 2nd BS 105/Bo 40.0% 20.0% Base…
  23. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 23
    Frac Parameters 25
  24. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 24
    Bone Spring 30 Day Average I.P. increasing each year (COG Operating) 26 Source - Concho Resources Inc. (COG Operating)
  25. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 25
    Frac Size (lbs. of Proppant) vs. EUR (Boe) 1,000,000 - 247 MBoe vs. 3,000,000 - 326 MBoe EUR (Mboe) 600 y = 0.0394x + 207.91 500 400 EUR (MBoe) 300 EUR (Mboe) Linear (EUR (Mboe)) 200 100 0 0 1000 2000…
  26. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 26
    Plug & Perf Completion 28 Estimated EUR from PI Dwights and Drilling Info through September, 2012 Public production data from State of Mexico, and Drilling Info through September, 2012
  27. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 27
    Packers Plus Completion 29 Estimated EUR from PI Dwights and Drilling Info through September, 2012 Public production data from State of Mexico, and Drilling Info through September, 2012
  28. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 28
    Plug & Perf vs. Packers Plus Plug & Perf Mean P90 P10 P10/P90 EUR 284,339 Boe 85,790 Boe 527,470 Boe 6.15 180 day 47,190 Boe 14,724 Boe 90,148 Boe 6.12 Max. Month 503 Boe/day 180 Boe/day 913 Boe/day 5.07 s Proppant 1,929,339…
  29. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 29
    Proppant Strength 31
  30. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 30
    Fracture Modeling 3 Frac Clusters 70 BPM 4 Frac Clusters 70 BPM Frac Length Created 951 Frac Length Created 900 Frac Length Propped 283 Frac Length Propped 253 Frac Height Average 211 Frac Height Average 185 Frac Height Propped 189…
  31. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 31
    Rock Properties 33
  32. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 32
    Avalon Shale Producing Well COG Operating Production (thru 8/2012 -564 days ) Graham Nash State Com. 1H 42,830 Bo - EUR 88,797 Bo 30-015-37498 1,144,787 Mcfg EUR 2,823,387Mcfg 227,360 Boe EUR 559,362 Boe 266,708 Bw Last month average 198…
  33. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 33
    2nd Bone Spring Producing Well COG Stratojet 31 State Com. Cluster Analysis C6 C2nd Fractured Carbonate Approx. Depth of lateral 69 in Mode 4 10.9% porosity 7.5 Pore Volume 330 of Mode 5 7.5% porosity 24.9 Pore Volume…
  34. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 34
    Rotary Core Information 3rd Bone Spring Lea County 2nd Bone Spring Eddy County Porosity 10.0%, Perm. 0.62md Porosity 11.5%, Perm. 4.9md 36
  35. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 35
    Pickett Plot 3rd Bone Spring and Wolfcamp Sand Interval 1 Production thru July 2012 66,528 Bo EUR 319,246 Bo 59,726 Mcfg EUR 453,882 Mcfg 76,482 Boe EUR 394,893 Boe 159,331 Bw In 269 days Sw 100% Sw 75% Sw 50% DPHI (Log…
  36. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 36
    Rock Volume and Stimulation Comparisons 38
  37. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 37
    Pore Volume vs. EUR Comparison Well EUR Proppant Pore Initial (boe) (lbs) Volume Production (ft) Well A 1,045,984 1,983,280 31.4 1,262 Boe/day Well B 335,987 1,264,862 16.9 449 Boe/day 39
  38. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 38
    Well B C6 C2nd Approx. Depth of lateral 139 of Mode 9 with 9.6% porosity 13.3 Pore Volume 12 of Mode 4 with 9.7% porosity 1.2 Pore Volume 30 of Mode 5 with 7.5% porosity 2.3 Pore Volume. Total Pore Volume 16.9 40
  39. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 39
    Well B EUR Estimate Post Drill 96 days of Oil Production Well B Production Thru 11/6/2012 138 days of oil production 26,300 Bo 120 Bo/d * 44,469 MCFG 263 Mcfg/d* * - Last 10 day average 41
  40. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 40
    Well A C6 C3rd Proposed Depth of lateral 275 in Mode 4 11.4% porosity 31.4 Pore Volume in the 3rd Bone Spring in this well. Sonic log only available for porosity, but transform ties other wells 42
  41. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 41
    Well A EUR Estimate Post Drill 23 days of Oil Production Well A 43
  42. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 42
    Conclusions 44
  43. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 43
    Drilling Hazards & Production Problems Thick Overburden (Anhydrate and Salt Section) difficult to maintain vertical throughout, can increase drilling costs. High H2S & CO2 possible in the Avalon Shale Section, decreases economics…
  44. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 44
    Conclusions Multiple Stacked Pay Objectives in the Bone Spring Trend 1st, 2nd and 3rd Bone Spring Sand have the strongest economics. It is governed by Log Normal Statistics. Good correlation between frac size and EUR Bigger is…
  45. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 45
    Acknowledgements Engineering Staff at Caza Richard Wright G & G Staff at Caza Mike Ford CEO & President of Caza for volunteering me for this presentation American Business Conference for hosting this event 47
  46. SE New Mexico Horizontal Bone Spring Economic Prospective – Caza Oil & Gas, Inc. – slide 46
    Glossary of Abbreviations Bbl one barrel, each barrel representing Mcf/d one thousand cubic feet of natural gas Boe or Mcfe may 34.972 Imperial gallons or 42 U.S. gallons per day be misleading, bbl/d barrels per day Mcfe one thousand…

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